Is Twitter in Trouble from Identi.ca?

Twitter, the popular micro-blogging service, has yet to monetize its popularity. There are rumors of upcoming business options – which makes sense considering Dell Computers claims twittering earned them an extra $1M in 2008. However, there’s only VC funds keeping Twitter going, and a relatively new entry in the micro-blogging arena, Identi.ca, just received funding to make an Open Source variant of Twitter.

What do you think? Would that even work – as in be any more monetizable than Twitter? Keep in mind that a similar service, Pownce, got purchased by Six Apart and for the most part is getting buried. Seems standalone microblogging services will have a hard time against Twitter. But integrate a micromessaging service with another app – such as the way the status message is on each user’s Facebook wall – and then it becomes very useful.

So if Twitter decided to license out their technology to be integrated with the likes of, say, LinkedIn, MySpace, and so on, then you have a potential way to monetize. But where does that leave Twitter competitors such as Identi.ca? Well, I’m predicting the rise of BuddyPress-powered niche social networks, so you might see Identi.ca’s Open Source version integrate into there, in the form of plugins. Whether the latter can be monetized any better than Twitter remains to be seen. The key issue is where hosting will be done and whether people are going to want to have to remember multiple login account details.